If You Were Presenting Social Media To Channel Executives, What Benefit Would You Stress?

Despite the popularity of social media at the street level, many channel organizations have been holding back. Slowed by a potent mixture of financial, organizational, cultural, and intellectual impediments, some partnering professionals have not been willing or able to present a compelling case for social media investment. Instead, they have been hunkering down and hoping that they can be successful by working harder with familiar programs and tools.

There are exceptions. Social Media for reseller partners is now all the rage at some companies who have been smart enough to envision the potential of thousands of channel partners Twittering away about their products. They are not hunkering down. Quite the opposite. These corporations have incorporated channel partners into their social media plans and are moving ahead with social media training and program support.

There are reasons for these initiatives, of course. Good reasons. From our research, Gilwell has found there are three important social media benefits that channel managers are beginning to understand and quantify.

#1: End-users are already using social media to get information about products. Depending on which study you read, 60-90 % of customers begin their purchase process online by gathering information and looking for current customer comments. Increasingly aware of this pre-sales activity, channel managers want to make sure their products are well-represented.

#2: Communication between vendors, resellers and customers is noticeably improved using social media. Messages, attachments, and links are sent and received more quickly (usually getting through all those pesky corporate firewalls) from smart phones, netbooks, and other devices. And using social media drives down the cost of communications, sometimes by as much as 80%. It’s just cheaper to post a video on YouTube and send out a link than to maintain/expand a usable partner portal or distribute (and redistribute) a bunch of PDFs.

#3: Social Media is extremely effective at building and maintaining more intimate relationships. A reseller can maintain weekly contact with 50 customers in just a few hours by connecting with them at their online spaces. This replaces the 50 phone calls and scores of emails flying off into the ether. Most important, social media is personal in a way that good salespeople and their customers appreciate.

With social media, the issue of customer intimacy comes up a lot both in positive and negative terms. Some channel managers worry about exposing too much of themselves to their resellers and customers, thinking that there should be a line drawn between their personal and professional lives. They view social media as potentially intrusive and sometimes describe social media as a waste of time.

Others view the sharing of personal information as an important step in building productive long-term relationships. For them social media is a natural extension of the restaurants, bars, gold courses, and sporting events where they have long spent time with customers. These channel managers think that the time they spend on Facebook, LinkedIn, Twitter and other sites is an investment in future success.

In the end, customers will make the decision about how they want to interact with resellers and vendors. If they decide it is through social media (and there is a lot of evidence that this is happening) then the organizations and channel managers that are already engaged will have a big advantage.

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Social Media Good Highlights

If You Were Presenting Social Media To Channel Executives, What Benefit Would You Stress?

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Why Smart Resellers Are Not Using Social Media Yet

Resellers have to be smart to stay in business. If channel partners make a mistake, it costs them time, resources, and sometimes customers. So, they filter what they hear from suppliers and mostly ignore the latest predictions from industry “experts.” Resellers have learned (the hard way) that not every Silicon Valley wave will crest and not every new technology will revolutionize the market.

Consequently, the channel is expressing some valid skepticism about social media. Even with the technology industry’s rich history of marketing hyperbole, social media stands out for the level of noise touting its impact on the market. So the natural reaction in the channel is to be suspicious – and cautious. This time, however, that natural wariness could be a big mistake.

Social Media, when used correctly and consistently, can and will provide valuable benefits to vendors, partners, and customers. Social Media builds product awareness, encourages collaboration, speeds communication, provides immediate feedback, and allows a level of customer intimacy that was beyond comprehension just a few years ago. All of these are powerful benefits that will eventually be bent to the task of improving customer satisfaction and channel sales productivity.

Before channel partners can experience any significant productivity gains, they are going to have to address their fears and inadequacies regarding next generation relationships. Here are the top ten reasons that resellers give for not jumping into the social media pool (based on interviews, emails, posts, and discussions with channel managers.)

1. Fear of Wasting Time – Resellers are busy. Can it really be productive to watch training videos on Yahoo, provide information to strangers on SlideShare, catch snippets of information about product problems on Twitter, or catch up with customers on LinkedIn?
2. No Leadership From Suppliers - Channels are ill equipped to figure it out themselves and are waiting for direction. Vendors initially went around their channels and connected directly with customers. (Now everyone is scrambling to get the channel plugged back into the conversation.)
3. Lack Of Reseller Marketing Capabilities - Social Media is much more than a marketing tool, but if a reseller doesn’t have a marketing strategy, it doesn’t help much to open a Twitter account and start sending random marketing messages to strangers.
4. Lack Of Reseller Management Sponsorship - If the company owner isn’t using LinkedIn and Twitter, then the employees are going to be reluctant to talk about that funny Cisco video on YouTube or something they saw on Facebook. Has your boss “Friended” you yet? Probably not.
5. Misperception That It’s Only For Kids - Very wrong. The average age on Twitter and Facebook is over 30 years old and both sites are rapidly becoming important hubs for B2B communications. Careers are now being made (and destroyed) online.
6. Focus On Short Term Goals - Building online relationships with customers takes some time and effort. Maybe it’s better to make a cold call and hope to get lucky and sell something this afternoon.
7. Perceived Lack of Value – This is all so new that there are no acceptable ROI models or case studies. So resellers keep doing what has provided good ROI in the past – like attending trade shows.
8. Fear of Exposing Customers – Social Media is open and intimate. Everything you can see, your competitors can also see. What if, gasp, your customers and competitors connect online? But what if you connect with their customers?
9. Fear of Looking Bad – By its nature, social media is personal. Many fear that blurring the line between their business and personal lives will diminish their effectiveness. Does it help your credibility if your biggest customer sees you dressed up in a dorky costume and doing the chicken dance with friends?
10. Fear of change – The only person who likes change is a wet baby. Change has to be forced sometimes, all too often in the face of disastrous events. Eventually “customer needs” are going to force resellers to work through social media – before or after business is lost.

Do you recognize yourself in any of the above? You are not alone. These kinds of discussions happening up and down the distribution chain. And they will continue for a while.

However, reseller skepticism will eventually pass as the rhetoric begins to die down and the channel starts building productive online relationships with their customers and suppliers. This will happen in 2010. It’s not going to be simple, easy, or without problems. Mistakes will be made; but in the end, resellers will do what they always do – learn, adapt, and move forward.

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Social Media Good Highlights

Why Smart Resellers Are Not Using Social Media Yet

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SaaS Trumps Social Media

With all the hype surrounding social media, it’s easy to overlook the impact of the Software as a Service (SaaS) model that enabled the social media phenomenon. (Certainly, fewer people would be using Twitter if they had to purchase it and load it onto their computer.) And while 2010 is going to be the year of social media enablement for resellers, the next decade is going to be about adapting business models and channel programs to support the sale of services rather than products.

There is little debate that a significant percentage of channel revenue is going to shift to the SaaS delivery model (potentially through online communities). The only real discussion is about how fast this will happen and how high the SaaS revenue percentage will be in 2020. Recently, the ISV World Conference in Germany asked me to make a presentation on this subject. So we pulled out some cameras and shot three videos about the SaaS market to be shown during the Conference. Joining me is SaaS expert Ken Boasso.

SaaS Market Size Video on YouTube

SaaS Market Segments Video on YouTube

SaaS Sales Success Video on YouTube

If you don’t have time to watch all the videos (about 30 minutes), let me net it out for you. SaaS is already big and its going to get bigger. A different channel business model is required, one that can deal with thousands of new users/subscriptions a month. Social Media is a key enabler for SaaS because it enables low cost and effective marketing and sales capabilities. The resellers of today are not ready for any of this and will be looking to their vendors for leadership. Some traditional vendors are going to push their resellers into bankruptcy by pressuring them to sell products rather than Cloud services. The old channel is going to have to make some tough choices very soon. A new channel is going to emerge to specialize in selling Cloud services and not hardware or software products.

The biggest issue in marketing is trying to understand the new channel for selling SaaS (Cloud) services. IMHO, this issue is more important than social media, but we can’t get around to addressing it until channel executives are familiar enough with SaaS that they can make good planning assumptions. And that is why social media is critical. It gives everyone “hands-on” experience and a glimpse of how channels of the future are going to look.

Social Media changes (and levels) the playing field for marketing, communications, and customer intimacy. New strategies for reseller success are needed. SaaS, however, changes the entire game and a new league will have to be created. Is your channel program ready to play?

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